Barclays Looks for OK to Intro Silver Bullion
ETF

Each share of the ETF would be equivalent to 10 ounces
of silver, according to the Securities and Exchange
Commission (SEC) filing by Barclays, MarketWatch news
reported.

According to MarketWatch, the silver held by the ETF
would be valued on the basis of that day’s announced London
Fix, the price per ounce set by three marketmaking members
of the London Bullion Market Association at approximately
noon, London time, each day. On Friday, the London Fix for
silver was $7.37 an ounce.

Bank of New York will serve as trustee for the silver
ETF and the London branch of J.P. Morgan Chase Bank, will
be the custodian, according to the Barclays filing.

The sponsor’s fee is 0.5% of the adjusted net asset
value of the trust, according to the filing. The trust may
sell some of its silver to cover expenses, meaning the
amount of silver per share may vary over time, according to
the report.

The introduction of StreetTracks Gold Trust, the first
gold ETF, in November was one of the most successful
mutual-fund launches of 2004, as the ETF gathered about
$550 million in its first day of trading, according to
MarketWatch.

Similar to investing in gold ETFs, silver is classified
as a “collectible” by the Internal Revenue Service (IRS).
If held for more than one year, gains are taxed at a 28%
rate, compared with the 15% rate applicable to most other
long-term capital gains, according to the news report.